Taking Care of Employees in Katrina-Affected Communities
By: Carolyn Cavicchio, 09/09/05

The outpouring of support by corporations in support of Hurricane Katrina relief and recovery efforts has been tremendous: well over $100 million has been contributed to date by companies across the U.S. and around the world. Some companies are responding to the effects of Katrina in a more personal way, however by supporting their employees who live and work in the communities in Louisiana, Mississippi and Alabama that were directly affected by the hurricane. 

Some companies have continued to pay employees even though offices, stores, warehouses and other facilities have been shut down for over a week.  Other companies are working through their Human Resources departments to help employees take paid leaves or use vacation time so that they can continue to draw paychecks.

- Montreal-based Couche-Tard, which operates Circle K convenience stores in the U.S., is continuing to pay the salaries of all its personnel in affected communities and has promised to find work in the company for those who temporarily lost their jobs due to the floods and hurricane.

- Home Depot’s 5,000 workers in the area can check in — or go to work — at any of its stores. "We want to get the message out that they can go to any Home Depot in the country and get a job," according to company spokesman David Sandor.

- Boyd Gaming, which operates the Treasure Chest Casino in Kenner, Louisiana, is taking a variety of steps to care for the 1,000 Treasure Chest employees and their families directly impacted by this tragedy.   The company has developed a payroll extension plan to pay employees regular base wages, including an adjusted tip rate for tipped employees, for a period of up to eight weeks, should the property be closed for the entire period.  For employees who lost their homes and have no other temporary housing options available, the company has set aside a limited number of rooms at its Sam's Town property in Tunica, Mississippi, with meals available at a minimal cost to employees and their immediate dependants. 

- UPS, which has more than 2,200 employees in the hurricane impact area, has extended medical benefits to those employees who may not be working for the next 30 days; made it easier to obtain medical and pharmaceutical assistance away from home, and opened a specially staffed toll-free phone number for its employees needing assistance. 

Employees who were not directly affected by the hurricane are encouraging in some cases, demanding that their companies do more to help colleagues who lost homes, possessions, and livelihoods.  Rather than contributing to general relief efforts, these companies are creating funds to help their own employees recover from this disaster.

- Pinkerton Government Services (PGS) has established the PGS Katrina Relief Fund to receive cash contributions and distribute them to its employees affected by this disaster.  The company will match all personal contributions, which are not tax-deductible.  To ensure fair distribution to those most in need, the fund will be managed by a three-person committee composed of the Vice President for Human Resources, the Division President, and the Controller.  The fund will remain open for six months and all donations will go directly to the employees in need.  After the account is closed, any remaining funds will be sent to the American Red Cross for Katrina Relief.

- Wal-Mart’s displaced associates are eligible for up to $1,000 from an Associate Disaster Relief Fund if their homes were flooded or destroyed; cash assistance of nearly $4 million has already been provided to more than 6,100 associates.  The company has also provided over $17 million in cash and goods to assist non-employees affected by the hurricane.

- UPS has established a relief fund to which the company and other UPS employees will contribute to support fellow UPSers who have lost their homes and belongings. The UPS Employee Hurricane Relief Fund was launched with an initial $250,000 contribution from the company, which also will match contributions from other employees.  Through the UPS Foundation, the company has also donated $1.25 million  -- $500,000 in cash and up to $750,000 of in-kind services for the shipment of medical and health-related items -- to The American Red Cross, America's Second Harvest, and other relief organizations that assist with long-term rebuilding activities.

For companies that have established, or plan to establish, a relief fund for their own employees, here are some considerations:
- Will the relief fund be financed by the company, or will employees also be able to  make donations?  Will additional funds be sought from non-employees as well?
- Does the company have an existing foundation or public charity to raise and distribute these funds?  If not, will one be created, so that contributions to the fund can be tax-deductible?
- Which employees will be eligible to receive money from the fund?  All those in affected areas?  Only those who have lost their homes?
- Will eligible employees all receive the same amount of financial support, or will a means-test or sliding scale be applied?
- Who will make decisions on how the funds will be allocated?
- Will there be a reporting or monitoring mechanism for the funding, once it has been provided to eligible employees?
- What will happen to any dollars left in the fund once employees’ needs have been addressed?
- How can the company balance interest in/publicity for its relief efforts with affected employees’ need/desire for privacy?